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Include equations please! Firm A is considering the purchase of an asset that has an installed cost of $150,000 and has a recovery period of

Include equations please!

Firm A is considering the purchase of an asset that has an installed cost of $150,000 and has a recovery period of 5 years. It will be the firms only asset, and the assets depreciation is already reflected in its EBIT estimates.

Set up a Depreciation Table using the following MACRS table.

recovery year 3 years 5 years 7 years 10 years

1

33% 20% 14% 10%
2 45% 32% 25% 18%
3 15% 19% 18% 14%
4 7% 12% 12% 12%
5 12% 9% 9%
6 5% 9% 8%
7 9% 7%
8 4% 6%
9 6%
10 6%
11 4%
total 100% 100% 100% 100%

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